– Liquid Staking protocols ended the reign of Decentralized Exchanges (DEX), taking the spot of the second-biggest protocol after Lending.
– Liquid Staking still single-handedly eclipsed Lending as Lido DAO surpassed the TVL of AAVE and JustLend.
– Additionally, when it comes to growth, Liquid Staking outperformed Lending, increasing by 334% and 176%, respectively.
With the year coming to an end, the DeFi market is also locking in the changes witnessed throughout 2023.One key change was the Ethereum Shapella
hard fork that not only impacted the market but seemingly altered the face of the Decentralized (DeFi) market entirely.
Ethereum Shapella hard fork
Ethereum mainnet went through the Shanghai hard fork earlier this year in April, which enabled the option to withdraw the ETH staked by validators.This occasion was expected to be a hugely bearish event as the crypto market feared that the investors might choose to pull out their staked ETH.
However, following the hard fork, the opposite happened as more money started pouring into staking protocols.With the option and safety of withdrawing their assets at any time, investors went in deep with staking, the result of which could be seen on the DeFi market.
The category of Liquid Staking protocols witnessed an increase starting in March, and by the end of June, it surpassed the Decentralized Exchanges (DEX) category.DEXes reigned as the second biggest protocol category since 2021, which came to an end.
Since the beginning of 2023, the total value locked (TVL) in Liquid Staking protocols increased by 334%, which is nearly twice the 176% growth witnessed by DEXes in the same period.Today, the former holds over $32 billion in TVL, while the latter contributes $21 billion to the DeFi market.
DeFi market TVL distribution
The surge in Liquid Staking was such that Lido DAO, the biggest protocol in this category, outshined other top DeFi applications (Dapp), including AAVE, which belongs to the Lending category, the biggest by TVL.Today, Lido has over $22.3 billion worth of TVL, which is twice AAVE’s $10.9 billion.
Top DeFi protocols by TVL
Come 2024, the demand for DeFi is expected to increase, and naturally, investors will choose to put their money in the safest form of returns, which could be being a validator on Ethereum.This will further boost the steady rise of TVL of Liquid Staking protocol, making it likely unsurpassable by any other Dapp category.
Information on these pages contains forward-looking statements that involve risks and uncertainties.
Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets.You should do your own thorough research before making any investment decisions.FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements.It also does not guarantee that this information is of a timely nature.Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress.All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.
The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned.
The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations.The author makes no representations as to the accuracy, completeness, or suitability of this information.FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use.Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Join Telegram
Follow us on Telegram
Stay updated of all the news
Recommended Content
Editors’ Picks
Cosmos price gives investors a buying opportunity before a possible swing to $17.19 for ATOM
Cosmos price is trading with a bullish bias, which has seen the cryptocurrency vindicate itself from underneath the confines of a descending trendline.
This is a bullish sign, hinting at a strong rally depending on how bulls play their hand.
More Cosmos News
XRP price consolidates after failing crucial breach even as Binance announces Ripple-USDC listing
XRP price is witnessing a dry run, making minimal growth since the 19% crash of mid-November.
External factors are not contributing much either, given Ripple has remained largely away from any kind of rally even as Binance Spot listed a new XRP trading pair.
More Ripple News
Ethereum price eyes $2,500 mark as Solana market takes a breather
Ethereum price looks poised for a shine after a prolonged contention against its peer in the Layer 1 space, Solana.This brings to mind previous reports where Solana founder Anatoly Yakovenko said he envisions a future where SOL and Ether co-exist, urging that the whole narrative of one ecosystem kills the other be binned.
More Ethereum News
Optimism Price Prediction: OP price could crash as $82 million worth of tokens due to flood markets
Optimism is trading with a bullish bias, pumping hard to become the biggest gainer among Layer 2 tokens.With a trading volume drop of 60%, its biggest contender in the sector, Arbitrum is up 10% while OP boasts an outstanding 120% surge in trading activity.
More Optimism News
Bitcoin: BTC readies for home run in 2024 with two bullish fundamentals on tap
Bitcoin (BTC) price has been bullish in 2023, scaling up as it tried to plough back the ground lost following the Terra (UST) and FTX crashes of the preceding year.
The trajectory took shape in spite of it being an eventful year, with BTC riding the wave of macroeconomic as well as industry-related developments.
Read full analysis.
